Can a credit card company take me to court for non-payment on the balance?

Question

I have an outstanding balance with a credit card company in the amount of 1,600.00. I haven't paid on it since August 2005 because of a lot of hard times that have hit me these last 2 years. I wasn't expecting them to happen when I opened the credit card, but things happen. Anyways, they called me last night and told me if I didn't make a payment by the end of December I was going to get summoned to court. I even cried on the phone and she said there was nothing she could do and I would be slammed by the lawyer fees and so on. I can't take this. Is it true they really could take me to court if I didn't pay by the end of this month or is it a scam to get my money quicker?

Answer 1

You should have mentioned your country place.As in different countries the laws are differently applicable.

Answer 2

The people saying they won't bother to sue don't understand how easy collection suits are--they will sue you over $1600. You have two choices--negotiate a settlement with them, or get sued. At this point, getting sued isn't as bad as you might think (though it is pretty bad) -- you probably don't want a lawyer yourself, and there isn't much you can do about your lawyer fees. Try to make an agreement with them so you don't hurt your credit any more than you already have.

If they have already sent you a summons, you have been sued. If they haven't yet, they could do so whenever they want--it sounds like they did you the courtesy of letting you know it will happen soon. If you ignore the suit, the court will decide in their favor and say that you owe the money, and issue a judgment. You should only fight in court if you don't owe the money--since that isn't you, you need to negotiate with the credit card company to allow you to make a payment you can afford to avoid or dismiss the suit.

If you can't reach an agreement with them you can afford, they will sue and get a judgment against you. (Even after they have the judgment, you can negotiate with them, but they can be less cooperative--they have done half the collection work.) Once they have the judgment, they can get a garnishment against your bank account or paycheck. You would need to be careful not to leave all your money in the bank, because the amount of the judgement could be frozen until you answer the garnishment, and they will take their money back from you. Also, you need to answer any garnishments you receive (and may need a lawyer for that) so that you can be sure that your exemptions for living expenses are allowed.

Regarding PP, don't go the bankruptcy route unless you have a lot more debt than $2000 on that one card--your credit will get better faster if you pay it off than declaring bankruptcy. That is a last resort.

Answer 3

What state are you in? Has the deadline to file your answer expired yet? How old is this debt? Are you being sued by the original creditor or a collection agency? Why are they suing if you are in a debt settlement program? That is very irregular, but unfortunately it does happen. Did the debt settlement company notify you that the credit card company had refused your settlement? If they did not, then I suggest that you get out of this program and find another one. And I would file a complaint with the Better Business Bureau, too. If you're being sued by the original creditor, winning can be difficult because they are very likely to have a lot of the paperwork that they would need to win. If you're being sued by a collection agency, then the standard of proof becomes higher. I would try to hire an attorney if you can afford it to see if he can buy you some time to get your papers in order and to file some kind of defense. Being unable to pay is not a defense, and maybe an attorney can help you to achieve a settlement with this company. Again, if it is a debt collector, then the standard of proof, as I said, is more difficult for them. Make sure that you show up for your court date. Maybe you can ask the judge for a continuance so that you can have time to prepare for your case and to get an attorney. If you don't show up, the credit card company will win a default judgment. I would also tell the judge that you were in a debt settlement program that unraveled for you. I would even hope your lawyer would bring the debt settlement people into court as witnesses to show that you are making good faith in paying. Good luck. I hope that they will accept a settlement to help but getting a lawyer is your best bet now if you can afford it.

Answer 4

Non Payment Of Credit Card

Answer 5

They did it to me for $2400. Actually at that point it was the collection agency. They took me to court. The thing they can put a freeze on your bank account which is what they did to me. The freeze didn't come off unitl I went to court. It was really horrible because I didn't have any cash for weeks because my account was frozen. It was also very EMBARSSING. Once I got to court I found out they can't take any cash under a certain amount don't remember how much exactly ($2500 - $5000) but if I didn't make a payment plan with them they would start garnishing my wages which would be even more embarassing. So I made a payment plan with for like $100 a month. Then what I did is used my income tax return and neogiated my balance down with them by telling them i could afford to pay less then the balance due but they would get it all at once or they could just keeping accepting my $100 monthly. I ended only paying $2000 of $2400 I owed.

Answer 6

wow, you have alot going for you ( in a bad way)! You are pregnant. You are 20 years young. You owe money. Well, it's not that bad, your life will be better soon, don't worry! Why not just pay it with another credit card or loan some money from your parents? Or your boyfriend/husband for that matter. I heard you work so that means you can just call them up (the collection agency or whoever is threatening you to court) and set up a payment installment plan of $50 dollars a month or more. It depends on what you can agree on. Crying on the phone won't do you any good. there are dozens and dozens of people in your same position (I mean about the dept thing) and so you shouldn't feel like they would care if you cried to them. But I feel sorry for you, you seem like you are all alone in this so just do your best.

Answer 7

There is a statutes of limitations on credit card debt. Look up what it is for your state. If you don't pay anything on it for 2 years or whatever it is then they can't claim it, it's too late for them. The credit card company sells your debt to a collection agency. Then they start calling and if send them money or promise to send money the clock starts all over again. It sounds like the agency is desperate to get just a $15 payment so that they have an other 2 years to get paid. If you really don't have the money than don't send anything and don't say that you will. I doubt that they will take you to court.

Answer 8

The bottom line is don't talk to them. Tell them you are in the midst of filing bankruptcy with your lawyer and you are not acknowledging the debt.

If you own a home or a car worth over $2500 it may be worth it for you to file bankruptcy to protect your existing assets and prevent garnishment of your paycheck.

I doubt seriously that any company would go to court over such a small amount. It costs them money to file and if you have no assets they can go after it's a waste of their time and money.

If the calls are frequent change your phone number to unlisted or get a cell phone.

If they do take you to court do not appear. They will find for them in a default judgement for the money you already owe them plus court costs. But again highly unlikely it would go that far over measley $1600.

A year or so down the road you will get an offer from the lender to settle for half of the amount if you pay it off. If you have the money at that time pay it and get it off your credit record.

Otherwise after 7 years the debt has to be expunged off o your credit record whether you declared bankruptcy or not.

The worst downside to all this is that you will have to exist without credit for 7 years. Hopefully you will get used to this and never go back to paying those terrible interest rates in the future.

Answer 9

$1,600 is not that much debt in the grand scheme of things. Even if you've fallen on tough times, you should at least try to pay something on the card, $30, $40, $50 a month, anything to show the creditor that you have intent to pay off the balance. (After over a year of not paying anything shows to the creditor you have no intention of paying off the debt.)

Also, do an Internet search on "Consumer Credit Counseling services". A CCC company will work with you and your credit card company to waive any ongoing interests fees to help you pay off the debt. Also, if you come across a CCC service that charges you a fee for their services, then don't use them. There are services out there that don't charge anything. Good luck!

Answer 10

Can they bring you to court: yes

Will they bring you to court: absolutely not.

This is a technique used by collection agencies to scare you into paying them.

Here's how it works:

When your bill goes into default, the credit card company sells your account to a collection agency. The collection agency pays roughly 10% of your debt to the credit card company, and then you owe them the money instead of the credit card.

The collection agency then calls and sends letters designed to scare you into paying them. They invested 10% of your debt in the hope that they can get you to pay the full amount, and they turn a profit. That's how the business works.

The threat of court is ridiculous. The company doesn't have the resources to take all of their clients to court. It would cost them more than $1600 in lawyer fees just to get you IN the courtroom, so even if they win, they lose money by taking you to court.

You have absolutely nothing to worry about. In seven years, this debt is erased from your credit score. Don't worry about it.

By the way, DO NOT offer to pay them ANYTHING or make ANY agreement with them of any kind. Simply hang up the phone when they call. If you agree to pay them ANYTHING, it resets the 7 year time table to erase it off of your credit history. If you do anything else, you're only making things more difficult on yourself than they need to be.

As far as garnishing your wages or placing liens on your property, most states do not allow it. I have relatives living in PA who owe tens of thousands of dollars in debt, and they cannot by law touch their paycheck, home, tax return, or anything else. The same goes for many other states. All they can do is send letters and call. Check the laws of where you live.

Anyone who tells you any different is wrong, or they're a liar.

Answer 11

Yes, a bank or collection agency can take you to court, but it is not a criminal proceeding: they are suing you. It varies from state to state and country to country, but you should know right off the bat that it is not a crime to owe money to institutions that you can't pay.

9 times out of 10, for an amount as small as you mentioned, they won't even bother. They threatened you with lawyer fees, but you have to remember that they have their own lawyer and processing fees to consider. This is a large bank that doesn't go to the ends of the earth to get every cent owed to them, but is always considering the bottom line.

A typical court procedure is that the bank sues, you don't show up to defend yourself, the court rules in favor of the bank and orders you to pay up. Depending on the severity of the case and the court's mood, they may order you to pay the bank's court fees and have your wages to garnished (up to a certain percentage as allowed by your local government). It is extremely rare for a court to order property seized unless your debt is on par with the value of said property (i.e. you owe a hundred thousand dollars and you happen to own land).

Finally, if the case is really that bad, there is always another option: bankruptcy. filing for bankruptcy protects you from debt collection, wage garnishing and property seizure. When the procedure is through, your debt is wiped clean and you begin rebuilding your credit.

My final advice is this: get a professional opinion. Debt law is different everywhere, and maybe you live in some backwater state that thinks people in debt are scum, but probably not. Don't listen to people who say you deserve everything the bank does to you. Being in debt is a serious problem for most Americans, rich and poor, but there are second chances. There are even programs in many states that offer free debt counseling. Visit your state or municipal government websites or call them and ask.

Until you are actually officially sued, don't worry about court.